Intel Capital, the venture capital arm of Intel Corp. is hoping to invest in a handful of Israeli startups in a variety of fields in 2018, bringing the number of companies it invests in this year to six.
The investments in Israel will be “significant” in size, said Yair Shoham, who is part of a team of three in charge of investments for the venture capital arm in Israel. Shoham spoke to The Times of Israel on Tuesday, on the sidelines of Intel Capital’s Global Summit in Palm Desert, California.
In February this year, Intel Capital led a $50 million investment round in Israel’s public transit data and analytics firm Moovit, with the US giant investing some $30 million in the company.
The venture capital firm, which makes both strategic and financial investments in startups for Intel Corp., has invested more than $375 million in some 80 Israeli startups since it started investment activities in Israel in 1997. They include Alcide, a developer of data center security; Anobit, a developer of flash memory controllers, which was sold to Apple in 2012; OrCam, a developer of wearable vision system to help visually challenged people; and Moovit. Intel Capital made six investments in Israel in 2017.
The focus of the activity has been in a variety of fields, similar to those in which Intel Capital invests in globally: autonomous driving, artificial intelligence, cybersecurity, chip accelerator technologies, cloud and data storage and connectivity, robotics, and sports and entertainment.
“All our investments in Israel are in early stage companies that are developing breakthrough technologies,” said Shoham. “We need to invest in the high risk, early stage, in order to be at the forefront of innovation. That is the essence of what we do.”
Intel views Israel as a source of technologies that will help transform the US chip maker into “a driving force of the data revolution across every technology and every industry,” according to Intel CEO Brian Krzanich’s vision for the firm. His strategy is to transform Intel from a PC company to one that powers the cloud and billions of smart, connected computing devices.
Intel Capital has seen 28 exits of the Israeli companies it has invested in – mainly through sales of the firms and some initial public offerings — and today holds an investment portfolio of some 23 Israeli companies.
“When we present the companies we are interested in at the investment committee of Intel Capital globally, it does not matter if we are from Israel or not,” Uri Arazy, a director of investments of Intel Capital in Israel said in an interview. “I have to convince them that the technology I am presenting is the best in the world, because each one of my colleagues in Intel is presenting their companies.”
The investment directors get a total of 40-45 minutes to present their technologies to the board, and then a vote is taken, he explained. Israel, however, has a good record of getting investments, he said. “We are in a good situation.”
“Israel is a very important market for us, a very strategic one,” said Li-Chung Anthony Lin, a VP and managing director at Intel Capital International, in charge of Intel’s international investments. “The market is very active and we see tons of good opportunities.”
In addition to its investment activities, Intel Corp. has made 13 acquisitions in Israel since 2010, including automotive technology firm Mobileye, which Intel Corp. bought last year for a whopping $15.3 billion.
At the summit Tuesday, Intel Capital announced it had invested $72 million in 12 tech startups, nine US companies and three Chinese startups in the fields of artificial intelligence, cloud computing, the Internet of Things, and silicon technologies.
The companies in which Intel Capital has invested in its latest round “are driving innovations that will shape the future of computer over the next decade,” Intel said in a statement. They include startups dealing in AI-based conversational computing that will help boost the design of virtual assistants, a context-aware app that improves the way people experience stadiums, theme parks, hotels and hospitals, and new processors that bring the power of machine learning to mobile devices.
“These innovative companies reflect Intel’s strategic focus as a data leader,” said Wendell Brooks, Intel senior vice president and president of Intel Capital. “They are helping shape the future of artificial intelligence, the future of the cloud and the Internet of Things, and the future of silicon. These are critical areas of technology as the world becomes increasingly connected and smart.”
The company also announced a new sports and entertainment collaboration with NBA, called the NBA + Intel Capital Emerging Technology Initiative. The multiyear collaboration will seek to identify and grow technology firms that have “the potential to impact the future of the NBA, sports and entertainment.”
Thanks to the digitalization of sports and the explosion of data, there’s been “more disruption” in sports “over the last five years than in the 70 before that,” Brooks said. Even so, innovation has just scratched the surface, and with the launch of 5G technology and improved artificial intelligence capabilities, the sports industry is poised to provide even more immersive and real-time experiences.
In 2016, Intel acquired Israeli startup Replay Technologies, a developer of 3D video technology that is used by professional sports broadcasters, for over $160 million. Replay is today an R&D center for Israel in the field of sports technology. In addition, Intel Capital invested in the sports startup WSC Sports Technologies, which has developed an automatic, real-time platform to create video for sports broadcasts.
Since starting its activities in Israel in 1974, Intel Corp. has made cumulative investments and acquisitions of some $35 billion in Israel and employs some 11,000 workers in its manufacturing plant in Kiryat Gat, and in its R&D centers in Jerusalem, Petah Tikva and Haifa. In addition, the firm employs more than 1,000 workers at Mobileye, according to data provided by the firm. Intel Capital has been active in Israel since 1997.
The writer is a guest of Intel Corp. at the summit.